Continental Engines P. Ltd., New Delhi V. DCIT, Central Circle-26, New Delhi

ITA 4468/DEL/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 9122 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 05-07-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Search and seizure; Opportunity of being heard; Deemed export; Assessment record; Benefit of exemption
• Section: 143(3); 153A; 139(5); 10B; 143(2); 132; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: B NEW DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER [THROUGH VIDEO CONFERENCING] ITA NOS. 4468 & 4469/DEL./2017 ASSESSMENT YEARS: 2010-11 & 2011-12 M/S. CONTINENTAL ENGINES PVT. LTD., 3 RD FLOOR, TOWER-D, GLOBAL BUSINESS PARK, M.G. ROAD, GURGAON VS. DCIT, CENTRAL CIRCLE-26, NEW DELHI PAN :AABCC9896N (APPELLANT) (RESPONDENT) ORDER PER O.P. KANT, AM: THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAI NST A COMMON ORDER DATED 30/03/2017 PASSED BY THE LEARNED CIT(APPEALS)-31, NEW DELHI [IN SHORT THE LD. CIT(A )] FOR ASSESSMENT YEARS 2010-11 AND 2011-12 RESPECTIVELY. AS COMMON ISSUE IN DISPUTE ARE INVOLVED IN BOTH THE APPEALS, SAME WERE HARD TOGETHER AND DISPOSED OFF BY WAY OF THIS CONSOLIDAT ED ORDER FOR CONVENIENCE. APPELLANT BY SHRI K.V.S.R. KRISHNA, ADV. RESPONDENT BY MS. NIDHI SRIVASTAVA, CIT(DR) DATE OF HEARING 24.12.2020 DATE OF PRONOUNCEMENT 08.01.2021 2 ITA NO. 4468 & 4469/DEL./2017 2. THE GROUNDS RAISED IN ITA NO. 4468/DEL/2017 FOR ASSESSMENT YEAR 2010-11 ARE REPRODUCED AS UNDER: 1. THE ADDITION BY WAY OF REDUCTION IN CLAIM OF 10 B HAS NO NEXUS TO THE SEARCH AND SEIZURE OPERATION AND CONSEQUENTLY T HE ORDER U/S 153A/143(3) IN SO FAR AS REDUCTION IN THE CLAIM OF 10B IS WRONG AND BAD IN LAW AND SHOULD BE DELETED. 2. WITHOUT PREJUDICE, THE ID. CIT(A) HAS ERRED IN CONFIRMING THE AOS ORDER AND REDUCING THE CLAIM U/S 10B WITH RESPECT T O MISC. INCOME AND INTEREST INCOME. BOTH THE INCOMES ARE PR OFITS OF THE BUSINESS OF THE UNDERTAKING AND ELIGIBLE FOR 10B DE DUCTION. 3. THE ABOVE GROUNDS ARE INDEPENDENT OF AND WITHOU T PREJUDICE TO ONE ANOTHER. 4. THE APPELLANT PRAYS THAT HE MAY BE ALLOWED TO A DD, ALTER, AMEND OR DELETE ANY OF THE GROUNDS AT THE TIME OF HEARING . 3. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSE SSEE WAS ENGAGED IN THE BUSINESS OF MANUFACTURING OF AUTOMOB ILE PARTS. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE FILE D RETURN OF INCOME IN TERMS OF SECTION 139 (1) OF THE INCOME-TA X ACT, 1961 (IN SHORT THE ACT) ON 13/10/2010 DECLARING LOSS OF 8,57,15,202/-, WHICH WAS FURTHER REVISED UNDER SECTION 139(5) OF T HE ACT ON 22/03/2011 AT LOSS OF 9,11,16,007/-. THE RETURN OF INCOME FILED BY THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMEN T AND NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED. 3.1 SUBSEQUENTLY, A SEARCH AND SEIZURE OPERATION UNDER SECTION 132 OF THE ACT WAS CARRIED OUT ON 10/12/2012 AT THE PREMISES OF THE ASSESSEE AND CONSEQUENTLY, NOTICE UNDER SECTION 153A OF THE ACT WAS ISSUED ASKING THE ASSESSEE TO FILE THE RETU RN OF INCOME. IN RESPONSE, THE ASSESSEE FILED RETURN OF INCOME ON 31 /12/2013 DECLARING LOSS OF 9,91,16,007/- AND ASSESSMENT WAS COMPLETED UNDER SECTION 153A READ WITH SECTION 143(3) OF THE ACT ON 27/03/2015, AFTER DISALLOWING DEDUCTION UNDER SECT ION 10B OF 3 ITA NO. 4468 & 4469/DEL./2017 THE ACT ON INTEREST INCOME (RS.90,73,212/-), SCRAP SALES (RS.51,88,633/-) AND MISCELLANEOUS INCOME (RS.82,5 1,135/-) 3.2 ON FURTHER APPEAL, THE LEARNED CIT(A) ALLOWED DEDU CTION UNDER SECTION 10B OF THE ACT ON THE SCRAP SALES OF 51,88,633/-, HOWEVER, SUSTAINED THE DISALLOWANCE OF DEDUCTION IN RESPECT OF INTEREST INCOME AND MISCELLANEOUS INCOME. 3.3 AGGRIEVED, THE ASSESSEE IS BEFORE THE TRIBUNAL RAI SING THE GROUNDS AS REPRODUCED. 4. BEFORE US, BOTH THE PARTIES APPEARED THROUGH VIDEOCONFERENCING FACILITY AND FILED SUBMISSIONS THR OUGH EMAILS. THE LEARNED COUNSEL OF THE ASSESSEE FILED A PAPER-B OOK CONTAINING CASE LAWS. 5. BEFORE US, THE LEARNED COUNSEL OF THE ASSESSEE SUB MITTED THAT CASE OF THE ASSESSEE IS FULLY COVERED BY THE D ECISION OF THE TRIBUNAL IN THE CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 2008-09 AND 2006-07 AND FOLLOWING THREE DECISIONS: 1. PCIT VS. DISHMAN PHARMACEUTICAL AND CHEMICALS LT D. [2019], 417 ITR 313 (GUJ.) 2. RIVIERA HOME FURNISHING VS. ADDITIONAL CIT [2017] 9 ITR OL 401 (DEL.) 3. CIT VS. HRITIK EXPORTS PVT. LTD., [2015] 4 ITR OL 267 (DEL) 6. THE LEARNED COUNSEL SUBMITTED THAT IN THE ABOVE DE CISIONS, IT IS HELD THAT FOR THE CLAIM OF DEDUCTION UNDER SE CTION 10A/10B OF THE ACT, THE PROFIT AND GAINS OF THE UNDERTAKING SHOULD BE CONSIDERED, WHICH INCLUDE INCOME LIKE PROVISIONS WR ITTEN BACK, INTEREST ON FDR, SALE OF THE SCRAP AND ANY OTHER IN COME WHICH FORMS PART OF THE PROFIT AND GAINS OF THE BUSINESS AND PROFESSION. 4 ITA NO. 4468 & 4469/DEL./2017 HE FURTHER SUBMITTED THAT INTERPRETATION DERIVED F ROM IN RESPECT OF THE CASES COVERED UNDER CHAPTER VIA WOULD NOT AP PLY TO THE CLAIM UNDER SECTION 10B OF THE ACT WHICH IS GOVERNE D BY SPECIFIC PROVISION NAMELY 10B(4) OF THE ACT, ALLOWING THE BE NEFIT IN RESPECT OF PROFIT OF THE BUSINESS OF THE UNDERTAKING. RELYI NG ON THE DECISIONS, THE LEARNED COUNSEL SUBMITTED THAT MISCE LLANEOUS INCOME AND INTEREST INCOME IN THE CASE OF THE ASSES SEE ARE PART OF PROFIT OF THE BUSINESS OF THE UNDERTAKING AND THERE FORE, THE ASSESSEE IS ENTITLED FOR DEDUCTION UNDER SECTION 10 B OF THE ACT. 7. ON THE OTHER HAND, THE LEARNED DR SUBMITTED THAT I NTEREST INCOME AND MISCELLANEOUS INCOME ARE NEVER PART OF T HE BUSINESS OF THE UNDERTAKING. SHE SUBMITTED THAT THERE IS NO DETAIL OF THE MISCELLANEOUS INCOME AVAILABLE ON RECORD, ON THE BA SIS OF WHICH IT COULD BE ESTABLISH THAT IT IS PART OF THE PROFIT OF BUSINESS OF UNDERTAKING. SIMILARLY, THE SOURCE OF INTEREST INCO ME IS ALSO NOT KNOWN FROM THE ASSESSMENT RECORD. ACCORDINGLY, SHE SUBMITTED THAT ISSUE IN DISPUTE MAY BE RESTORED TO THE ASSESS ING OFFICER FOR DECIDING IN ACCORDANCE WITH LAW. 8. WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES ON T HE ISSUE IN DISPUTE. WE FIND THAT GROUND NO. 1 HAS NOT BEEN PRESSED BY THE LEARNED COUNSEL OF THE ASSESSEE. EVEN OTHERWISE, TH E ASSESSMENT U/S 143(3) OF THE ACT WAS PENDING AND SAME WAS ABET TED DUE TO SEARCH ACTION UNDER SECTION 132 OF THE ACT AND, THE REFORE, THE ASSESSING OFFICER IS JUSTIFIED IN CONSIDERING THE D ISALLOWANCE OTHER THAN BASED ON INCRIMINATING MATERIALS FOUND AND SEI ZED DURING THE COURSE OF THE SEARCH. THE GROUND OF THE APPEAL IS ACCORDINGLY DISMISSED. 5 ITA NO. 4468 & 4469/DEL./2017 9. AS FAR AS GROUND NO. 2 IS CONCERNED, WE FIND THAT, THE LD. CIT(A) HAS SUSTAINED THE DISALLOWANCE OF DEDUCTION U/S 10B IN RESPECT OF INTEREST INCOME OF 90,73,212/- AND MISCELLANEOUS INCOME OF 82,51,135/-. AS FAR AS INTEREST INCOME IS CONCERNE D, THE LD. CIT(A) FOLLOWED FINDING OF HIS PREDECESSOR IN ASSESSMENT YEARS 2008-09 AND 2009-10, WHERE THE INTEREST ON MA RGIN MONEY WAS EXCLUDED WHILE WORKING OUT THE DEDUCTION UNDER SECTION 10B OF THE ACT AND ACCORDINGLY, HE HELD THAT INCOME FRO M INTEREST WAS NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 10B OF THE ACT. FOR EXCLUDING OF MISCELLANEOUS INCOME FROM DEDUCTION, T HE LD. CIT(A) RELIED ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF LIBERTY INDIA LTD (SC) 317 ITR 218 AND PANDIYAN CHE MICALS( 262 ITR 258). 9.1 IN THE CASE OF DISHMAN PHARMACEUTICALS AND CHEMICA LS LTD (SUPRA), HONBLE HIGH COURT OF GUJRAT AFTER CONSIDE RING VARIOUS DECISIONS ON THE ISSUE IN DISPUTE HELD AS UNDER: 62. IN VIEW OF THE AFORESAID DISCUSSION, WE HOLD T HAT THE DIVIDEND INCOME, PROFIT ON SALE OF FIXED ASSETS, PROFIT ON S ALE OF INVESTMENTS, EXCESS PROVISION / RETURN BACK, DUTY DRAWBACK AND I NTEREST INCOME COULD BE SAID TO HAVE DIRECT NEXUS WITH THE INCOME OF THE BUSINESS OF THE UNDERTAKING. ALTHOUGH IT MAY NOT PARTAKE OF THE CHARACTER OF PROFIT AND GAIN FROM THE SALE OF ARTICLE, YET IT CO ULD BE TERMED AS AN INCOME DERIVED FROM THE CONSIDERATION REALIZED BY T HE EXPORT ARTICLES. IN VIEW OF THE DEFINITION OF 'INCOME FROM PROFITS A ND GAINS' INCORPORATED IN SUB-SECTION (4), THE TRIBUNAL COMMI TTED NO ERROR IN GRANTING THE BENEFIT OF EXEMPTION, AS CONTEMPLATED UNDER SECTION 10B OF THE ACT. 9.2 IN THE CASE OF RIVIERA HOME FURNISHING (SUPRA), THE HONBLE DELHI HIGH COURT AFTER TAKING INTO CONSIDERATION IT S DECISION IN THE CASE OF HRITNIK EXPORTS P. LTD (SUPRA) HELD AS UNDER: 17. THE CONTENTION OF THE ASSESSEE AS REGARDS CUST OMER CLAIMS WAS THAT IT HAD RECEIVED THE CLAIM OF RS. 28,27,224 FRO M A CUSTOMER FOR CANCELLING THE EXPORT ORDER. LATER ON THE CANCELLED ORDER WAS 6 ITA NO. 4468 & 4469/DEL./2017 COMPLETED AND GOODS WERE EXPORTED TO ANOTHER CUSTOM ER. THE SUM RECEIVED AS CLAIM FROM THE CUSTOMER WAS NON-SEVERAB LE FROM THE INCOME OF THE BUSINESS OF THE UNDERTAKING. THE COUR T FAILS TO APPRECIATE AS TO HOW THE ITAT COULD HAVE HELD THAT THIS TRANSACTION DID NOT ARISE FROM THE BUSINESS OF THE EXPORT OF GO ODS. EVEN AS REGARDS FREIGHT SUBSIDY, THE ASSESSEE'S CONTENTION WAS THAT IT HAD RECEIVED THE SUBSIDY IN RESPECT OF THE BUSINESS CAR RIED ON AND THE SAID SUBSIDY WAS PART OF THE PROFIT OF THE BUSINESS OF THE UNDERTAKING. IF THE ITAT WAS PREPARED TO CONSIDER T HE DEEMED EXPORT DRAW BACK AS ELIGIBLE FOR DEDUCTION THEN THE RE WAS NO JUSTIFICATION FOR EXCLUDING THE FREIGHT SUBSIDY. EV EN AS REGARDS THE INTEREST ON FDR, THE COURT HAS BEEN SHOWN A NOTE OF THE BALANCE SHEET OF THE ASSESSEE [WHICH WAS PLACED BEFORE THE AO] WHICH CLEARLY STATES THAT 'FIXED DEPOSIT RECEIPTS (INCLUD ING ACCRUED INTEREST) VALUING RS.15,05,875 ARE UNDER LIEN WITH BANK OF IN DIA FOR FACILITATING THE LETTER OF CREDIT AND BANK GUARANTE E FACILITIES.' IN TERMS OF THE RATIO OF THE DECISIONS OF THIS COURT BOTH IN HRITNIK EXPORTS (SUPRA) AND UNIVERSAL PRECISION SCREWS (SUPRA), THE INTEREST EARNED ON SUCH FDR OUGHT TO QUALIFY FOR DEDUCTION UNDER SE CTION 10B OF THE ACT. 9.3 THE LEARNED COUNSEL OF THE ASSESSEE HAS CONTESTED THAT BOTH ISSUES ARE COVERED IN FAVOUR BY THE ORDER OF T HE TRIBUNAL IN ASSESSMENT YEAR 2008-09 (ITA NO. 4207/DEL/2013) AND 2006-07 (ITA NO. 4208/DEL/2013). THE RELEVANT FINDING OF TH E TRIBUNAL IN AY 2008-09 ON THE ISSUE OF THE MISCELLANEOUS INCOME IS REPRODUCED AS UNDER: 5. THE FIRST GROUND IS 'AGAINST THE ORDER OF THE L D. CIT(A) ALLOWING THE CLAIM OF THE ASSESSEE, TO INCLUDE MISCELLANEOUS INCOME IN PROFITS OF BUSINESS, FOR THE PURPOSE OF COMPUTING DEDUCTION U/S 10B. THE FIRST APPELLATE AUTHORITY DEALT WITH THIS ISSUE IN PARA-5 AT PAGE 2 OF HIS ORDER. HE FOLLOWED HIS OWN DECISION TAKEN IN TH E YEAR 2006- 07 AND DIRECTED THE AO TO GRANT RELIEF. IN THE ASSTT. YEAR 2006-07 WE FIND THAT THE MISCELLANEOUS INCOME IN QUESTION PERT AINS TO SALE OF SCRAP AND WRITE OFF OF CERTAIN CREDIT BALANCES. BOT H THESE ITEMS OF INCOME HAVE BEEN ASSESSED UNDER THE HEAD INCOME FR OM, BUSINESS OF PROFESSION' BY THE AO. IT IS NOT THE CASE OF AO THAT THESE INCOMES ARE ASSESSABLE UNDER SOME OTHER HEAD OF INCOME AND NOT AS INCOME FROM BUSINESS. UNDER THESE CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT THE ORDER OF THE FIRST APPELLATE AUTHO RITY HAS TO BE UPHELD BY APPLYING THE DECISION OF THE SPECIAL BENC H OF THE TRIBUNAL IN THE CASE OF MARAL OVERSEAS LD. VS. ACIT, ITA NOS . 777 & 999 (IND) OF 2004 & 295 & 356 (IND) OF 2006 DATED 28.3.2012, WHERE IT IS HELD 7 ITA NO. 4468 & 4469/DEL./2017 THAT IN THE CASE OF LIBERTY INDIA, THE HON'BLE SUPR EME COURT HAS DEALT WITH THE PROVISIONS OF SECTION 80LA/80IB OF T HE ACT AND NOT SECTION 10B WHERE A FORMULA HAS BEEN PRESCRIBED U/ S 10B(4), THE APPLICATION OF WHICH WOULD RESULT IN ARRIVING AT TH E FIGURE OF PROFITS AND GAINS THAT ARE TO BE CONSIDERED AS DERIVED BY T HE 100% EOU, FOR THE PURPOSE OF COMPUTING EXEMPTION U/S 10B (1) THUS A DISALLOWANCE ON THE GROUND THAT A PARTICULAR INCOME IS NOT DERIVED FROM THE BUSINESS IS BAD IN LAW AS THE SAME DOES NO T CONFIRM TO THE FORMULA PRESCRIBED UNDER THE ACT. GROUND NO. 2 IS S AME AS GROUND NO. 1. HENCE BOTH GROUND NO. 1 & 2 ARE DISMISSED. 9.4 THE FINDING OF THE TRIBUNAL IN ASSESSMENT YEAR 200 6-07 ON THE ISSUE OF THE INTEREST AND MISCELLANEOUS INCOME IS REPRODUCED AS UNDER: 9. THE FIRST ISSUE IS REGARDING THE DELETION OF AD DITION OF RS.15,94,813/- BY THE LD. CIT(A) ON ACCOUNT OF DISA LLOWANCE OF INTEREST, ON INTEREST FREE LOAN OF RS.2.64 CRORES A DVANCED TO A SUBSIDIARY COMPANY. THE FIRST APPELLATE AUTHORITY H AS GIVEN A FINDING THAT THE AO WAS FACTUALLY WRONG IN HOLDING THAT THE ASSESSEE HAD GIVEN INTEREST FREE ADVANCE TO ITS SUBSIDIARY, M/S INTERMOTOR B V HOLLAND, EUROPE. 11. GROUND NO. 2 IS ON THE DISALLOWANCE OF DEDUCTIO N U/S 10B OF MISCELLANEOUS INCOME. THE MISCELLANEOUS INCOME IN Q UESTION IS EARNED .FROM SALE OF SCRAP. THE INCOME FROM THESE I TEM HAS BEEN ASSESSED UNDER THE HEAD ''INCOME FROM BUSINESS PROF ESSION'. UNDER THESE CIRCUMSTANCES THERE CAN BE NO DISALLOWANCE BY APPLYING THE PROPOSITION LAID DOWN BY THE SPECIAL BENCH OF THE T RIBUNAL IN THE CASE, OF MARAL OVERSEAS LTD. VS. ACIT ITA NOS. 777 & 999 (IND) OF 2004 & 295 & 356 (IND) OF 2006 DATED 28.3.2012 (SB) . FOR THE REASONS GIVEN WHILE DISMISSING REVENUE'S APPEAL GRO UND NO. 3 & 4 FOR THE ASSTT. YEAR 2008-09 GROUND OF THE REVENUE I S DISMISSED. 9.5 ON PERUSAL OF THE DECISIONS CITED BY THE ASSESSEE, WE ARE OF THE OPINION THAT IN TERMS OF SECTION 10B(4) OF THE ACT ANY PROFIT WHICH IS PART OF THE BUSINESS OF THE UNDERTAKING SH ALL BE ELIGIBLE FOR DEDUCTION IN THE RATIO OF EXPORT TURNOVER OF TH E ARTICLES TO THE TOTAL TURNOVER OF THE BUSINESS CARRIED BY THE UNDER TAKING. IN THE CASE OF DISHMAN PHARMACEUTICALS AND CHEMICALS LTD. (SUPRA), THE HONBLE COURT HAS HELD THAT DIVIDEND INCOME OR PROF IT ON SALE OF 8 ITA NO. 4468 & 4469/DEL./2017 THE ASSETS, PROFIT ON SALE OF THE INVESTMENTS, EXCE SS PROVISION WRITTEN BACK, DUTY DRAWBACK AND INTEREST INCOME THO UGH MIGHT NOT HAVE DIRECT NEXUS TO THE BUSINESS OF THE UNDERT AKING, BUT THEY COULD BE TERMED AS INCOME DERIVED FROM THE CO NSIDERATION REALIZED BY THE EXPORT ARTICLES AND, THEREFORE, EL IGIBLE FOR DEDUCTION UNDER SECTION 10B OF THE ACT. THE TRIBUNA L IN THE CASE OF ASSESSEE FOR ASSESSMENT YEAR 2008-09 FOUND THAT THE MISCELLANEOUS INCOME WAS CONSISTED OF SALE OF THE S CRAP AND WRITTEN OFF CERTAIN CREDIT BALANCES. IN THE YEAR UN DER CONSIDERATION, THERE IS NO DETAIL OF SOURCE OF MISC ELLANEOUS INCOME AVAILABLE ON RECORD EXCEPT AMOUNT OF INCOME. IN THE INSTANT ASSESSMENT YEAR, THE AMOUNT OF THE SCRAP SA LES WAS SEPARATELY IDENTIFIED AND NOT INCLUDED IN MISCELLAN EOUS INCOME AND SO BENEFIT OF DEDUCTION ON A SCRAP SALES HAS AL READY BEEN ALLOWED BY THE LEARNED CIT(A). IN ABSENCE OF DETAIL ED SOURCE OF MISCELLANEOUS INCOME, IT CANNOT BE DECIDED CONCLUSI VELY, WHETHER IT FORMS PART OF PROFIT OF THE UNDERTAKING OR NOT. SIMILARLY, IN CASE OF THE INTEREST INCOME, THE TRIBUNAL IN ASSESSMENT YEAR 2006-07 HELD THAT AMOUNT IN QUESTION WAS NOT INTEREST ON LO AN, BUT IT WAS INVESTMENT MADE IN PURCHASE OF SHARES OF SUBSIDIARY COMPANY FOR THE PURPOSE OF HAVING CONTROL OVER IT. IN VIEW OF T HE ABOVE DISTINGUISHING FACTS, THE RATIO OF THE DECISION OF THE TRIBUNAL (SUPRA) CANNOT BE APPLIED IN THE INSTANT CASE WITHO UT VERIFYING THE FACTS. IT IS ALSO NOT CLEAR FROM THE ORDER OF THE A SSESSING OFFICER IN THE INSTANT YEAR, WHETHER THE FDR WERE MADE FOR THE PURPOSE OF THE BUSINESS OR FOR MERELY EARNING INTEREST INCOME. NO SUCH DETAILS HAVE BEEN PROVIDED BEFORE US ALSO. IN VIEW OF THE FACTS AND CIRCUMSTANCES, WE FEEL IT APPROPRIATE TO RESTORE TH E ISSUE IN 9 ITA NO. 4468 & 4469/DEL./2017 DISPUTE TO THE FILE OF THE ASSESSING OFFICER FOR DE CIDING IN ACCORDANCE WITH LAW AFTER VERIFYING THE SOURCE OF M ISCELLANEOUS INCOME AND THE INTEREST INCOME. IT IS NEEDLESS TO M ENTION THAT ASSESSEE SHALL BE PROVIDED ADEQUATE OPPORTUNITY OF BEING HEARD. THE GROUND NO.2 OF THE APPEAL IS ACCORDINGLY ALLOWE D FOR STATISTICAL PURPOSES. 10. GROUND NO. 3 AND 4 BEING GENERAL IN NATURE, WE ARE NOT REQUIRED TO ADJUDICATE UPON; ACCORDINGLY, SAME ARE DISMISSED AS INFRUCTUOUS. 11. IN ITA NO. 4469/DEL/2017 FOR ASSESSMENT YEAR 2011- 12 THE ASSESSING OFFICER DISALLOWED DEDUCTION UNDER SECTIO N 10B OF THE ACT ON INTEREST INCOME (RS.1,08,79,093/-) AND SCRA P SALES (RS.99,02,015/-). THE LD. CIT(A) DELETED THE DISALL OWANCE IN RESPECT OF THE SCRAP SALES, HOWEVER, SUSTAINED THE DISALLOWANCE IN RESPECT OF THE INTEREST INCOME. 12. THE GROUND NO. 1 IN THIS APPEAL IS IDENTICAL TO NO. 1 RAISED IN ITA NO. 4468/DEL/2017, WHICH WE HAVE DECIDED IN EARLIER PARAGRAPHS. ACCORDINGLY, FOLLOWING OUR FINDING, THE GROUND NO. 1 IS DISMISSED . 13. AS FAR AS GROUND NO. 2 IS CONCERNED, IN THE YEAR U NDER CONSIDERATION ALSO IT IS NOT CLEAR FROM THE ORDER O F THE ASSESSING OFFICER AND LD. CIT(A) AS TO WHETHER THE FIXED DEPO SITS WERE MADE FOR THE PURPOSE OF THE BUSINESS OF THE UNDERTAKING OR FOR THE PURPOSE OF EARNING PURELY INTEREST INCOME. NO SUCH DETAILS HAVE BEEN PROVIDED BEFORE US ALSO. IN ABSENCE OF SUCH FA CTUAL INFORMATION, THE ISSUE IN DISPUTE IN THE YEAR UNDER CONSIDERATION IS ALSO RESTORED TO THE FILE OF THE ASSESSING OFFIC ER FOR DECIDING 10 ITA NO. 4468 & 4469/DEL./2017 AFRESH IN ACCORDANCE WITH LAW, AFTER PROVIDING ADEQ UATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 14. THE GROUND NO. 3 AND 4, BEING GENERAL IN NATURE, A RE DISMISSED AS INFRUCTUOUS. 15. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED PARTLY FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH JANUARY, 2021. SD/- SD/- (BHAVNESH SAINI) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 8 TH JANUARY, 2021. RK/- (D.T.D.S.) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI